FreedomWorks

The nonprofit FreedomWorks is "one of the main political outfits of the conservative movement and an instrumental force within the tea party," according to Mother Jones.[1] While FreedomWorks describes itself as "a grassroots service center"[2], political scientist Theda Skocpol has described the group as one of the "big-money funders and free-market advocacy organizations" that "leapt on the bandwagon" of protests in 2009 to advance their existing political agendas.[3]

FreedomWorks is an "associate member" of the State Policy Network, web of right-wing “think tanks” and tax-exempt organizations in 49 states, Puerto Rico, Washington, D.C., Canada, and the United Kingdom.

News and Controversies

FreedomWorks Memo on the Debt Limit

On August 25, 2017, POLITICO obtained an internal FreedomWorks memo which indicated that conservatives would not support federal debt limit increases without spending cuts attached. According to Nancy Cook of POLITICO, "In an internal FreedomWorks memo obtained by POLITICO, the group’s vice president of legislative affairs, Jason Pye, warned Republicans that conservatives will not support a “clean” debt limit increase — that is, one without any spending cuts attached. That’s a policy move that Treasury Secretary Steven Mnuchin has pushed recently in an effort to dampen any potential Republican-on-Republican warring over government spending." [5]

Dick Armey's Resignation

Dick Armey resigned as chair of FreedomWorks on November 30, 2012, sending his resignation to their CEO and President Matt Kibbe. Armey stated this was "effective immediately." Mother Jones reported his departure December 3, 2012, which was not made public by FreedomWorks.[1]

"The top management team of FreedomWorks was taking a direction I thought was unproductive, and I thought it was time to move on with my life," Armey told Mother Jones. "Obviously I was not happy with the election results," he says. "We might've gotten better results if we had gone in a different direction. But it isn't that I got my nose out of line because we should've done better." Asked if his disagreements were ideological or tactical, he replied, "They were matters of principle. It's how you do business as opposed to what you do. But I don't want to be the guy to create problems."[1]

As part of his resignation, Armey received $8 million in "consulting fees" from the group, paid in annual $400,000 installments.[6]

2012 Controversies Over FreedomWorks Leadership

On September 4, 2012, the day after Labor Day, Dick Armey and his wife, Susan, entered FreedomWorks's Capitol Hill offices accompanied by an unidentified man with a handgun holstered at his waist. The gun-toting man took FreedomWorks's top two employees from the office, as the Armeys informed sobbing employees they'd be losing their jobs.[7] Matt Kibbe, FreedomWorks's president, and Adam Brandon, its senior vice president, were removed from the premises by the armed man, two weeks after a gunman shot up the offices of the conservative Family Research Council, also in Washington, D.C.[8] One junior staffer, speaking anonymously, said “So when a man with a gun who didn’t identify himself to me or other people on staff, and a woman I’d never seen before said there was an announcement, my first gut was, ‘Is FreedomWorks in danger?’ It was bizarre.’ ”

A book, Hostile Takeover, had recently been published under president Matt Kibbe's name, though FreedomWorks staff contributed to its research, writing, and promotion.[9] Some of Armey's umbrage stemmed from Kibbe solely collecting royalties, which could jeopardize FreedomWorks's nonprofit status. Armey was threatening to sue Kibbe over the book deal. Armey was also frustrated with Kibbe and Brandon monopolizing media appearances while continuing to trade on Armey's name to market the group. Further complicating matters was Armey, as an old guard of the Republican Party, wanting to work with current GOP leaders. Younger members of FreedomWorks found that abhorrent, and indeed would soon denounce House Speaker John Boehner's proposed "fiscal cliff" compromise while Kibbe accused him of representing “the failed political establishment” and “purging House committees of fiscal conservatives.”[10] On December 19, 2012, FreedomWorks's blog celebrated Boehner's "Plan B" proposal.[11] The following day, in the same post titled "Two Cheers for Boehner's Plan B," they grimly note, “When folks in Washington thought FreedomWorks was for the bill, they assumed it would pass. When FreedomWorks came out against the bill, it failed. . . . After review of the Boehner Plan B legislation, pending in the House today, FreedomWorks has found it must oppose the legislation, and will be urging House members to vote NO on the bill. We will post our formal opposition letter on our site, soon.”[12]

There were many more intra-FreedomWorks disputes.[13] When Rep. John Mica, the Republican chair of the House transportation and infrastructure committee, was challenged by tea party freshman Rep. Sandy Adams in Florida in another primary race caused by redistricting, Kibbe wrote, Burnley, a transportation lobbyist, called Kibbe and "made it very clear…that he had a dog in this race." And on June 16, when FreedomWorks announced its "Retire Hatch" campaign against Sen. Orrin Hatch (R-Utah), C. Boyden Gray endorsed Hatch. A month later, Gray held a fundraiser for Wisconsin senatorial candidate Tommy Thompson—two days before FreedomWorks endorsed tea party favorite Eric Hovde, who was challenging Thompson in the GOP primary.

On December 12, James Burnley IV, a board member, and Gray sent Kibbe a letter informing him that they had received "allegations of wrongdoing by the organization or its employees."[14]They notified Kibbe that the group's board of trustees had retained two attorneys, Alfred Regnery and David Martin, to conduct an independent investigation of the allegations. Burnley and Gray ordered Kibbe to cooperate with the lawyers, to make sure no records were "destroyed, deleted, modified or otherwise tampered with," and to send Regnery a check for $25,000 to cover his initial fees. (Regnery, a prominent conservative, is the past president of Regnery Publishing, a right-wing firm that has put out books by Ann Coulter, Michelle Malkin, Pat Buchanan, and other notable conservatives.) The letter did not specify the allegations being investigated.

Shortly after receiving the December 12 letter, Kibbe wrote a memo outlining his beef with Armey, Burnley, and Gray. In the document—titled "Republican Insiders Attempt Hostile Takeover of FreedomWorks"—Kibbe accused the three of being shills for the Republican establishment and undercutting the group's standing as an independent, non-partisan, conservative organization.[15] (FreedomWorks has at times endorsed tea party candidates in primary elections against mainstream or incumbent Republicans, drawing the ire of mainline Republicans.) Kibbe charged that the three men were trying to punish him for defying their effort to steer FreedomWorks into the conventional Republican fold. He contended that the divisive fight within FreedomWorks was not really about his book contract or other organizational matters; it was a grand ideological clash pitting those fully loyal to the tea party cause (such as Kibbe) against backroom, Washington-centric pols attempting to wield their influence to benefit their pals. Of Kibbe's memo, Armey says "One of the most fascinating art forms in Washington is that of the perpetrator as victim. Matt Kibbe seems to have maintained it with this memorandum."[16]

Six days after walking in with an anonymous armed man to force key members out of FreedomWorks, Dick Armey agreed to an $8 million buyout. It was leveraged by board director Richard Stephenson, and all five targeted employees were back with FreedomWorks within that week. Stephenson is a 73-year-old millionaire residing in Illinois, founder of the for-profit Cancer Treatment Centers of America, and a longtime player in conservative activism.

The Washington Post notes the episode illustrates the growing role of wealthy donors in swaying the direction of FreedomWorks and other political groups, which increasingly rely on unlimited contributions from corporations and financiers for their financial livelihood. Such gifts are often sent through corporate shells or nonprofit groups that do not have to disclose their donors, making it impossible for the public to know who is funding them.

In the weeks before the election, more than $12 million in donations was funneled through two Tennessee corporations to the FreedomWorks super PAC after negotiations with Stephenson over a preelection gift of the same size, according to three current and former employees with knowledge of the arrangement. The origin of the money has not previously been reported.

The $12 million came from two corporations set up in Knoxville, Tennesse within one day of each other, Specialty Investments Group and Kingston Pike Development.[17] Both were established by William S. Rose III, a bankruptcy lawyer in Knoxville. Rose has refused to answer questions about the donations. Three current and former FreedomWorks employees say the money came from Richard Stephenson and his family.

Growing Membership through Insurance Sales

In 2006, the Washington Post revealed that from 2001 - 2006 CSE/FreedomWorks engaged in a hidden deal with insurance brokers whereby the brokers would sell high-deductible insurance policies and tax-free medical savings plans to individuals at a group discount, and those who purchased the plans would automatically be added FreedomWorks membership list. Customers unaware of the membership arrangement, for which they were charged extra fees. Membership was a condition of getting the discounted insurance plan. The arrangement was credited with helping increase the number of "members" FreedomWorks could claim belonged to the organization. About 16,000 people "joined" the organization in this manner, causing $638,040 to flow into FreedomWorks's coffers over 5 1/2 years in the form of monthly checks for "association fees" collected by the Medical Savings Insurance Company, that were forwarded to FreedomWorks.[18]

Activities

FreedomWorks has mobilized opposition to health care reform, taxes, union labor, "common core" education policies, network neutrality, and climate legislation. Since 2009, FreedomWorks has been involved in the Tea Party movement. Mother Jones writes that "FreedomWorks, under Armey's leadership, was a key player in the rise of the tea party in 2010. The organization helped elect tea party favorites" and works as a "connector between tea party groups around the country, organizing protests against Obamacare and expanding the ranks of the conservative movement."[1]

2014 Midterm Elections

According to Rollcall, which interviewed FreedomWorks president Matt Kibbe in June 2014, the group's "involvement in campaigns is centered on providing activists with the training and resources to mount a successful ground game."[19] Below are some of the major races in which FreedomWorks has been active in the 2014 election cycle.

Eric Cantor's Loss and the Vote for House Majority Leader
Republican House Majority Leader Eric Cantor lost to Eric Brat in the Republican primary for Virginia's 7th District on June 10, 2014.[20] Brat was backed by Tea Party activists, but had little support from outside groups such as FreedomWorks.[21] After Cantor lost, he announced that he would step down as House Majority Leader, prompting a June 19 vote for a new Majority Leader. Ahead of the vote, FreedomWorks supported Rep. Raúl Labrador (R-ID) against the presumed front-runner, Majority Whip Kevin McCarthy (R-CA).[22] The Washington Post described FreedomWorks as "one of the few outfits agitating for an alternative to McCarthy" when it "released a statement Friday morning [June 13] urging Labrador to announce a run."[23]

Kentucky
In Kentucky's Republican Senate primary, FreedomWorks backed Matt Bevin against incumbent Sen. Mitch McConnell, the Senate minority leader. FreedomWorks hosted a national conference for Tea Party groups in early April 2014, during which speakers including Matt Kibbe and Glenn Beck attacked McConnell.[24] FreedomWorks reported spending over $300,000 in the race,[25] part of over $1 million in spending by outside tea party groups. Bevin lost the primary, winning only 35.7% of the vote to McConnell's 60%.[26]

Mississippi
In the Mississippi Republican Senate primary, FreedomWorks supported state Sen. Chris McDaniel against incumbent Sen. Thad Cochran, spending around $419,000 as of June 18, 2014.[25] According to Kibbe, the group's support included "printing door hangers and yard signs and other literature their members can hand out when canvassing" as well as spending on social media.[19] Outside groups including FreedomWorks and the Chamber of Commerce had spent over $8.4 million on the race by early June. The June 3 primary ended with McDaniel slightly ahead but short of a majority, prompting a June 24 runoff vote. According to the Associated Press, FreedomWorks planned to spend an additional $350,000 in the runoff.[27]

North Carolina
FreedomWorks backed Dr. Greg Brannon against Thom Tillis in the North Carolina Republican Senate primary, spending $117,040.[25] After Brannon's loss, Kibbe said in an interview that Freedomworks was considering supporting Tillis against Democratic incumbent Sen. Kay Hagan by running "an "anti-Kay Hagan" campaign."[19] As of June 18, 2014, Freedomworks had already spent $44,776 campaigning against Hagan.[25]

Anti-Union Work (2011-2013)

In January of 2013, FreedomWorks President Matt Kibbe announced a new "Save the States" campaign. Four out of five issues in the campaign are tied to weakening unions, either directly or indirectly.[28]

In December of 2012, FreedomWorks announced "an aggressive grassroots, state-based campaign" for 2013 to "push back against domineering unions."[28] After the 2012 presidential election, FreedomWorks promoted a petition to "support Michigan Governor Rick Snyder" in his anti-union push[29], published multiple blogs attacking unions[30][31][32] , and released a study purporting to show the benefits of "paycheck protection" legislation to defund unions in Pennsylvania.[33]

FreedomWorks was also involved in an anti-union campaign in Ohio in 2011, supporting Republican Gov. John Kasich's "union-busting Senate Bill 5" with "tens of thousands of door hangers and yard signs" as well as a website.[34]

Organizing "grassroots" Tea Parties (2009)

FreedomWorks was one of the lobbying groups involved in orchestrating the April 15, 2009 anti-Obama, anti-tax "tea parties". In February 2009, the FreedomWorks website said the group was "now working with other groups to plan a massive, nationwide tea party protest day for Tax Day on April 15th, 2009"[35], the Tax Day Tea Party protests.

In summer of 2009, FreedomWorks began pursuing an aggressive strategy to create the appearance of mass public opposition to health care and clean energy reform at Congressmembers' town-hall meetings in their districts. A leaked memo from Bob MacGuffie, a volunteer with the FreedomWorks website "Tea Party Patriots," describes how members should infiltrate town hall meetings and harass and intimidate Democratic members of Congress:

"Spread out in the hall and try to be in the front half. The objective is to put the Rep on the defensive with your questions and follow-up ... You need to rock-the-boat early in the Rep's presentation. Watch for an opportunity to yell out and challenge the Rep's statements early. If he blames Bush for something or offers other excuses -- call him on it, yell back and have someone else follow-up with a shout-out ... The goal is to rattle him ..." [36]

At the time, The New York Times reported on accusations by Democrats that such town hall opposition was "part of a coordinated effort to scuttle the White House political agenda rather than a true representation of public opinion," and noted that FreedomWorks had "repeatedly been in the center of the controversy at town halls."[37]

"Grassroots" Anti-Bailout Website (2008)

In 2008, FreedomWorks was behind the creation of a fake grassroots web site called Angryrenter.com which rallied opposition to "the Obama Housing Bailout"; the site claimed to represent "Renters and responsible homeowners against a government mortgage bailout", and urged people to oppose bailing out mortgage companies. Michael M. Phillips of the Wall Street Journal investigated AngryRenter.com and reported[38]:

"AngryRenter.com looks a bit like a digital ransom note, with irregular fonts, exclamation points and big red arrows -- all emphasizing prudent renters' outrage over a proposed government bailout for irresponsible homeowners.

"It seems like America's renters may NEVER be able to afford a home," AngryRenter.com laments. The Web site urges like-minded tenants to let Congress feel their fury by signing an online petition. "We are millions of renters standing up for our rights!"

Angry they may be, but the people behind AngryRenter.com are certainly not renters. Though it purports to be a spontaneous uprising, AngryRenter.com is actually a product of an inside-the-Beltway conservative advocacy organization led by Dick Armey, the former House majority leader, and publishing magnate Steve Forbes, a fellow Republican. It's a fake grass-roots effort -- what politicos call an AstroTurf campaign -- that provides a window into the sleight-of-hand ways of Washington."

Ties to the Koch Brothers

"The Koch brothers, after helping to create Cato and Mercatus, concluded that think tanks alone were not enough to effect change. They needed a mechanism to deliver those ideas to the street, and to attract the public’s support. In 1984, David Koch and Richard Fink created yet another organization, and Kibbe joined them. The group, Citizens for a Sound Economy, seemed like a grassroots movement, but according to the Center for Public Integrity it was sponsored principally by the Kochs, who provided $7.9 million between 1986 and 1993. Its mission, Kibbe said, “was to take these heavy ideas and translate them for mass America.""[39]

Ties to Tobacco

Connections between the tobacco industry, third-party allies and the Tea Party, from the 1980's (top) through 2012 (bottom). The thick black line connects CSE with its direct successor organisations(Source:Tobacco Control[40])

According to the U.K. Guardian, FreedomWorks has received funding from the tobacco conglomerate Philip Morris. The Guardian also reports that local branches of FreedomWorks's sister organization Americans for Prosperity have also received tobacco money and opposes smoke-free workplace laws and cigarette taxes.[41] Freedomworks also opposes tobacco taxes.[42]

Tobacco Industry and the Tea Party

According to a study published February 8, 2013 in the journal Tobacco Control, "Rather than being a purely grassroots movement that spontaneously developed in 2009, the Tea Party has developed over time, in part through decades of work by the tobacco industry and other corporate interests."[40]Americans for Prosperity and FreedomWorks, both of whom have worked to oppose smoke-free laws across the United States since at least 2006, were major players in this effort, with help from the PR firm, DCI Group.[40]

History

Founding

In July 2004, FreedomWorks was created from the merger of Citizens for a Sound Economy (CSE) and Empower America.[4] (Although the FreedomWorks's website stated until late 2007 that it was founded in 1984[43], it was CSE that was founded at that time.)

In late July 2004, the initial FreedomWorks media release stated that "three of the most respected and accomplished leaders of the conservative, free-market movement" -- former Housing and Urban Development Secretary Dick Armey, former White House Counsel and conservative luminary C. Boyden Gray, and Jack Kemp -- "will serve as the Co-Chairmen of FreedomWorks. Bill Bennett will focus on school choice as a Senior Fellow. Matt Kibbe is FreedomWorks’ new President and CEO."[4]

In this initial statement, FreedomWorks outlined that its initial plan was to "run major voter education campaigns and Get-Out-the-Vote (GOTV) efforts in key races" in the 2004 Congressional elections. Kibbe stated that the role of FreedomWorks was to be a "powerful answer to the challenge presented by the Left and groups like America Coming Together (ACT), MoveOn.org, and the Media Fund."[4]

The statement said that FreedomWorks:

"...boasts over 360,000 members and a legal structure that includes a 501(c)(3), a 501(c)(4), a 527, a federal PAC, and various state PACs. FreedomWorks is headquartered in Washington, D.C., with full-time campaign staff on the ground in the battleground states of Florida, Illinois, Iowa, Michigan, North Carolina, Oregon, Texas, Washington, and Wisconsin. The new organization also houses a sophisticated conservative political database containing over 600,000 activist names in all 50 states."[4]

Funding

FreedomWorks is not required to disclose its donors. However, documents filed by donor organizations show that conservative foundations, trusts, and individuals, some with close ties to the Koch brothers, have donated large sums to FreedomWorks. These funders include the Lynde and Harry Bradley Foundation, the Richard and Helen DeVos Foundation, the Sarah Scaife Foundation. According to the Center for Responsive Politics, FreedomWorks "received nearly 60 percent of its $15 million in revenues from just four donors in 2012" who "gave between $1 million and $5 million each."[45] According to documents leaked to Mother Jones, in 2012,

"Eight donors gave a half-million dollars or more; 22 donated between $100,000 and $499,999; 17 cut checks between $50,000 and $99,999; and 95 gave between $10,000 and $49,999. Foundations contributed $1.6 million in major gifts, and corporations donated $330,000."[46]

According to the Washington Post, FreedomWorks board member Richard Stephenson arranged for around $12 million in donations to be funneled to FreedomWorks in 2012, and Stephenson reportedly promised to donate $400,000 per year for the following 20 years.[47]

Here is a partial list of major donors to the FreedomWorks Foundation:

↑CIA, "Appendices: The Contra Story, Report of Investigation Concerning Allegations of Connections Between CIA and The Contras in Cocaine Trafficking to the United States, January 29, 1998. Accessed June 19, 2014.